Metro and Tesco snap up Casino's Polish stores
operations to Tesco and Metro Group as it strives to repay debts in
excess of €2bn euros.
In a statement released today Casino said it raised €925m from the divesture, which saw Britain's Tesco pay €105m for its 279-store Leader Price chain.
Meanwhile Germany's Metro Group bought Casino's 19 Geant hypermarkets and seven landbank projects for €779m.
Casino has held onto a real estate portfolio in the country, including five petrol stations and several landbank sites, but intends to sell these later this year.
Today's transaction, along with other divestures earlier this year, has reduced Casino's total debt by €1.5bn and has had a positive impact on net income, the company said.
Casino's net income fell to €344m in 2005, from €547m a year earlier, as weak consumer spending in its domestic market hit profit margins. This forced France's second biggest supermarket group with interests in Brazil, Thailand and Vietnam, to sell €2bn of its international assets by the end of next year.
Last month Casino announced that Groupe Monnoyeur will pay €89.5m for its 38 per cent stake in Feu Vert, the leading chain of automotive parts and repair shops in France and Spain, as the firm sells off its non-core businesses. In March, Casino sold its Cora grocery chain to Belgium's Delhaize group.
Tesco takes Poland
Tesco, the world's fifth largest retailer, is currently market leader in Poland with a four per cent share of the grocery sector. The acquisition of Casino's Leader Price operation has now cemented its position in the region, and placed it firmly ahead of close French rival Carrefour.
The British retailer, which owned 44 hypermarkets and 36 smaller stores until this deal, has been in Poland since 1995.
Metro will now own 49 stores in the country, under the Real banner, while other international companies are also making moves to grab what is left of Poland's food retail market, which serves 38m consumers.
However the Polish government is keen to restrict the level of foreign retailers penetrating the market, in a bid to encourage local firms.
Tesco came under fire from Poland's finance minister Teresa Lubinska late last year, who said foreign hypermarkets were not welcome.
Nevertheless retailers are still attracted to the country, and with the whole CEE grocery market worth €187.8bn, compared to the UK's €176.7bn, this region represents a key growth opportunity for foreign firms, especially in provincial towns.
In 2004, total retail sales in Poland reached £66.1bn representing a growth of 7.5 per cent on 2003, according to marketresearch.com.
